Supply chain management is becoming essential for any company/brand to end up as a successful operation within the ecommerce manufacturing boom; when an emerging/establish brand grows, then it can quickly become overwhelmed with how to manage its inventory within its own warehouse(s)…Enter 3PL management to create operational efficiencies for your organisation by utilising the resources of a third party to perform the logistics functions that they would otherwise do themselves.
What is Third Party Logistics Management (3PL)?
Third-party logistics (or 3PL) encompasses all aspects of logistics (i.e., shipping & delivery, warehousing, inventory management & fulfilment) performed on behalf of an organisation by a third party. Rather than trying to execute all of these logistics functions on your own using your own physical warehousing facility and delivery fleet…you engage with a third party (Amazon is a great example) to manage the entire logistics process from the time an order is placed through to when it is actually delivered to the customer.
Benefits of Third-Party Warehousing & Fulfillment
Huge benefits of third party warehousing and fulfillment , looking to grow and scale their businesses quickly.
Cost Efficiency: New or existing companies typically have to pay considerable amounts of money to either purchase or lease warehouse facilities. A 3PL takes away those high fixed costs of overhead and turns them into variable costs that fluctuate with your sales volume.
Instant Scalability: If your company experiences seasonal surges or rapid increases in demand, you can easily scale the amount of space you need for your product and the number of people working on your inventory, without having to deal with administrative issues or leases.
Access to Advanced Technology: The top 3PL companies in India use the latest Warehouse Management Systems (WMS). With this technology in place, you’ll have immediate visibility to your inventory, the ability to forecast demand through artificial intelligence and the ability to automate the processing of customer orders, all without any significant capital expense up front.
Faster Last-Mile Delivery: Strategic placement of your inventory in regional hubs, close to your customer base, will ultimately allow for faster shipping times, greater customer satisfaction and reduced cart abandonment.
A 3PL Landscape Review of India
The Indian logistics landscape comprises enhanced and automated fulfilment organisations and hyper-local delivery systems through a well-developed ecosystem of technologies. When considering partners within this space, businesses will usually choose two main classes of providers:
Tech First Fulfilment Networks: Will be ideal for fast-growing D2C companies looking for the ability to integrate with multiple channels, plug-in play software and achieve speedy regional distribution.
Enterprise Contract Logistics: Created for large operations requiring a custom supply chain solution, handling heavy B2B cargo and having dedicated industrial space for warehousing.